How deep does the deep dive go?
This blog post is the finale of our no-obligation supply chain analysis series. To recap, at the end of our blog posts, we typically wind it up with an invitation — “click here for your no-obligation supply chain analysis.” What’s that about? We set about answering that question in two chunks:
- In Part I, we delved into what happens during IL2000’s supply chain analysis. We looked at the analyses we perform and the kinds of solutions we typically uncover.
- In Part II, we filled you in on how we’re able to offer hundreds of hours of upfront analysis at no cost. Or to put it bluntly, how is this thing free?
If you’ve read these, you should now have a solid understanding of the unique benefits you gain from this analysis and of how our business model and yours share a ton of mutually beneficial overlap.
And here you are reading part 3. We’re going to assume at this stage that you’re fairly interested. I mean, no person of sound mind sits down to watch 118 minutes of Back to the Future III if they didn’t find Marty McFly’s I and II escapades at least reasonably edifying, amiright?
So, let’s dive deeper.
In this blog, we’ll dive down through the 101 skim to the still, dark waters of real, gritty logistics data — the 201 of supply chain analysis, if you will. Let’s look at just how deep our deep dive goes.
Ready? Best take a deep breath.
Let’s dive.
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_______ The 101 _______
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Blog posts about virtual cannibalism and weird thought experiments
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A high-level Us vs Them comparison
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Case studies
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_______ The 201 _______
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White papers
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Expert market analysis
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Subject matter experts straight-talking about hard data
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_______ You are here _______
Welcome to the data deeps
Welcome! We hope your ears didn’t pop on the way down. As your eyes adjust, we should inform you that exotic and highly evolved data lifeforms inhabit these dark data waters. These individuals float through the ones and zeroes, drawing from a bristling array of refined analytical skillsets to perceive the world in ways we normal folk of the overworld can’t.
Case in point: meet one of IL2000’s intrepid deep divers: Tim Gavronski, Director of Pricing, Analytics and Business Processes. Individuals like Tim spend weeks, months, years down here, poring over a potential client’s freight transactions, sifting through countless tiny packets of supply chain information to transform data points into insight.
We grabbed a coffee with Tim for his detailed take on three of the most important indicators IL2000 captures during a supply chain evaluation deep-dive. And yes, we insisted he highlight just three.
Here (sans a few acronyms we had to look up) were his answers.
1. True landed cost
“Have you ever seen one of those videos where a sight-impaired person has an optical medical procedure and sees clearly for the first time,” Tim asked? “That’s the kind of reaction true landed cost often gets from a new customer. True landed cost (TLC) can open people’s eyes.”
The beauty of true landed cost is that you can suddenly see a true, total dollar figure cost for shifting an item of freight. Obviously, this includes all shipping costs, but it also includes harder-to-quantify outlay like administration and opportunity costs. Moreover, our breakdown of TLC allows you to look at your costs by shipping lane, time of year, and a host of other variables.
“When we show the true landing cost to a potential client, they're often seeing their supply chain in a way they hadn’t considered before,” Tim said. “It’s often shocking because vast quantities of individual transactions come together in a way that is suddenly clear and concise – that makes immediate sense.”
Tim explains the kinds of insights true landed cost can reveal:
2. Least cost carrier
“Sometimes, shippers can fall into bad habits. It could be that they use only one carrier for a particular lane. Or ‘tribal knowledge’ could build up received wisdom on why they have to ship using one particular modality. All of these possibly ill-advised decisions are put under the spotlight with this kind of analysis.”
This was how Tim segued across to least cost carrier — a trusty, workhorse indicator IL2000 repeatedly uses to root out sub-optimal shipping processes as a first step to bolstering a client’s supply chain with smarter decision-making and better outcomes.
The least cost carrier metric — perhaps counter-intuitively — is not simply about finding the lowest cost carrier and calling it a day. It’s about establishing a responsive and data-driven sliding scale of carrier choices that equips you to identify the most optimally priced carrier given the criteria you must meet in order to achieve a successful shipment.
It was at this point in our conversation that the life-giving caffeine goodness of coffee began to dilute alarmingly in the interviewer’s bloodstream. Clarification was humbly requested and Tim was kind enough to simplify thus:
“Least cost carrier answers a critical question: What’s the least you can pay for a shipment when you factor in the risks, the rewards, and the results you need to accomplish?”
So least cost carrier is about balance. Let’s take LTL as an example. For LTL shipping, you’d typically have a choice from a continuum of premium to economical carriers. Many shippers struggle to strike a balance when identifying the optimal carrier for a given shipment. The least cost carrier metric breaks the impasse, equipping you with an objective way to find that balance.
We’ll hand the mic to Tim to talk about the considerable savings potential unlocked by carrier-specific analysis:
3. On-time performance analysis
“Shippers get it mixed up when they think about on-time performance. So often, they fixate on the moment of delivery; they think of on-time performance purely as the time a delivery arrives. They’re not thinking enough about pickup, and because of that, they’re missing a huge opportunity.”
With this observation, we sidestepped our conversation into on-time performance analysis. The most striking point Tim made in this part of our deep diviest of data dissections was that sometimes using data effectively requires a change of mindset — an internal shifting of goalposts even.
On-time performance analysis, then, isn’t just a departure and an arrival time. It’s a critical look at the pathway of time-bound decisions that made a shipment early, on-time or late, and it starts right at the moment a shipment request arrives at your virtual front door.
Here’s an example of that critical knowledge in action.
“If you’re only looking at delivery, you have no way of knowing if the shipment is going to be late until it’s too late,” Tim said. “By looking at systems and workflows for tracking on-time pickup we can identify ways to quickly intervene. For example, you can get terminal managers and VPs of operations on the phone while the freight is in transit and fix it. With the right on-time mindset, you can still save that load.”
What does that mean during your no-obligation supply chain evaluation?
After analyzing your data, IL2000 will come back to you with a complete picture of on-time deliveries. What you end up with is front and back-end insight into your on-time performance. And this ultimately makes you far more resilient to the supply chain unknowns.
And as Tim explains here, having that kind of data may well be the start of a beautiful friendship between your company and ours:
Up periscope
Whew. We’ll leave Tim at this point to continue his deepwater data explorations into true landed cost, least cost carrier, and on-time performance. Floating back on the warm, frothy waters of the 101, we have two simple questions for you.
Do you really know what opportunities and risks lurk in the depths of your supply chain data?
And if you don’t … would you like to?